With an investment of over 33 billion euros, Intel wants to

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Intel announced on Tuesday that it intends to invest more than 33 billion euros ($ 36 billion) in stimulating chip production in the European Union, as the EU bloc tries to become more autonomous with regard to semiconductors, Reuters reports.

The chip maker in Santa Clara, USA, has said it will build two new plants in Madgeburg, Germany, as part of the investment.

Factories will use the most advanced chip-making technology as part of an effort to produce chips with a width of two nanometers or less.

Factory construction is scheduled to begin in the first half of 2023, and production will begin in 2027, provided there are no regulatory issues, Intel said.

The company said that Germany is an ideal place to set up the new mega-center “Silicon Junction” due to the talent and infrastructure offered, as well as the existing ecosystem of suppliers and customers.

About 17 billion euros will be invested in German facilities, Intel said, adding that the investment is expected to create 7,000 jobs in construction during construction, and 3,000 permanent jobs at Intel.

German Chancellor Olaf Scholz said in a statement that the factories would help rebalance the global chip capacity and create a stronger supply chain.

They will be backed by billions of euros in state aid, according to an article published by The Financial Times.

In addition to Germany, Intel is also committed to setting up a new R&D center in France and investing in R&D services in Ireland, Italy, Poland and Spain.

Approximately € 12 billion is expected to be invested in doubling the production space of a plant in Leixlip, Ireland, where less state-of-the-art technology is being used.

Intel has said it will spend more than € 30 billion in Ireland when the expansion is completed.

In Italy, Intel has announced that it is “in negotiations” for a new production unit, worth 4.5 billion euros.

There has been a shortage of certain types of semiconductors in the world for about two years after the Covid-19 pandemic put pressure on supply chains as demand for electronics increased.

Europe is trying to reduce its reliance on semiconductors in Asia and the United States, but setting up chip factories costs billions of dollars.

Intel, one of the three chip makers along with TSMC and Samsung, said the investment is part of a larger package that will make Intel invest up to 80 billion euros in Europe over the next decade.

The European Commission, the EU’s executive arm, last month announced a new European chip law, which will allow an additional € 15 billion in public and private investment by 2030.

This is more than the € 30 billion in public investment previously allocated.